A SENIOR Gold Coast police officer accused of an affair with a junior constable - including false allegations of sex in a squad car - is fighting a demotion ordered by incoming Police Commissioner Ian Stewart.

Former district duty officer Arron Ottaway was demoted from senior-sergeant to sergeant and had his pay docked after he was found in an internal police inquiry to have interfered in an investigation into his relationship with the rookie officer, and tipped off a colleague about a sexual assault complaint against him.

The Queensland Civil and Administrative Tribunal heard a Crime and Misconduct Commission complaint about Sgt Ottaway and the constable having sex in the patrol car was not proven, but they admitted to late-night meetings in the vehicle while she was off-duty.

Sgt Ottaway, who was stood down from duty from July 2010 until March this year when the punishment was handed down by then-Deputy Commissioner Stewart, is challenging the decision in the Queensland Civil and Administrative Tribunal.

In a hearing yesterday, his lawyers argued the disciplinary action was excessive and that he should not have been demoted or found guilty of misconduct.

The tribunal heard Mr Stewart considered sacking Sgt Ottaway but opted to impose the heavy sanctions because of his good record.

The investigation was sparked by "false and malicious" allegations that he had sex with the junior officer in his patrol car, the tribunal was told.

It heard that a sergeant who allegedly made a written complaint to the CMC containing those allegations later denied penning it and the letter was deemed a fake.

The tribunal heard Sgt Ottaway and the constable admitted to late-night meetings in his patrol car and "frequent" coffee get-togethers while she was off-duty.

Queensland Police Service barrister Scott McLeod said Sgt Ottaway's actions were "entirely inappropriate" and had been correctly punished because "he should have known better".

Sgt Ottaway's barrister, Chris Wilson, said his client and the constable were friends as well as colleagues and as her mentor it was "entirely appropriate for him to meet with her on or off-duty".

"It's simply not misconduct," he said.

"If it's anything at all, it's a breach of discipline."

QCAT member Peter Richards questioned how the public would view a senior officer spending time with an off-duty junior colleague "late at night in a police car when he should have been doing something else".

Mr Wilson said while the public "might have concerns about police resources being used in this way . . . it doesn't undermine confidence in the police service per se". Mr Richards reserved his decision.